Embracing Digital in a Non-Digital Industry

Following a trend solely because it’s popular usually isn’t a compelling argument in business, and even more so when it’s a very expensive trend. But digital isn’t a trend—it’s a transformative force in the world today that has touched, or will touch, every single industry. Not just a slight influence, either—some industries (like media) have been completely up-ended by digital, and most have been disrupted in some form, with more on the way.

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Jeff Immelt, CEO at General Electric, likes to say that if you woke up as an industrial company today, you will wake up as a software and analytics company tomorrow. His tongue and cheek comment doesn’t mean that your business will begin selling software, but rather that computer programs will become an essential part of how your business runs.

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Most business leaders have digital transformation projects on their company roadmap, but the time is running out. According to a study from Progress, 85% of enterprise decision makers say that if they don’t make significant progress on digital transformation within the next two years, their business will suffer financially.

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There isn’t a distinction between tech and non-tech industries, either. Look no further than what happened to taxi companies when Uber and Lyft launched to see the effect of digital on a typically analog industry.

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Digital can and will affect even the most analog industries out there. In this blog post, we’ll look at the basics of digital transformation, examples of its effect on organizations, and some tips for how lagging companies in traditionally analog industries can break through their barriers to digital.

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Let’s get started!

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What Is Digital Transformation? With Examples!

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Digital transformation is the integration of business and organizational processes with digital technology to accelerate business results, create efficiencies, and find untapped opportunities—both internally and in the market.

Wendy’s is replacing restaurant clerks with machines to save costs and open new lines of digital engagement with their customers

Trxade is using the HelloSign API to reduce the pharmaceutical application process for its vendors from 90+ fields to only a few clicks

Instacart eliminated paperwork from their Shopper onboarding process with an online-only system using HelloSign; allowing them to effectively scale their business

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Digital transformation is a hot topic, and most companies are already well into their own projects to transform their business, or are at least dipping a toe into the research. Let’s take a closer look at what’s causing this interest in digital transformation.

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Who’s Most Affected By Digital Disruption?

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As we mentioned earlier, media is one industry that has been massively impacted by digital disruption. This chart from HBR shows the full list of industries that executives believe will be significantly affected by a digital disruption in the next 12 months, expressed as a percentage.

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Consumer industries without a significant need for physical infrastructure are being disrupted at the highest rate. Blogs all but destroyed print publications, completely changing the revenue structure for advertisements, and perhaps also revolutionizing what type of content gets the widest distribution.

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Retail is also high on the list. The combination of ecommerce platforms like Shopify and Etsy, with dirt cheap sourcing, production, and drop shipping from foreign companies like Alibaba, have flooded the market with new retailers. While they may not be able to compete with large retailers like Target on margin, they will compete in terms of niche.

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Education and industrial sectors are near the bottom of the chart. This is understandable because both of those industries have a higher barrier to entry than B2C channels like retail, creating less competition. It’s not like the next Harvard or Caterpillar comes along every few years, as companies tend to do in consumer categories.

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But this doesn’t mean those industries are immune to digital disruption.

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In industry, advances in 3D printing threaten production and manufacturing.

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Education platforms like Khan Academy and Edx are giving away free education services which are surprisingly high quality. Perhaps even more surprising is they’re both non-profits without a ‘freemium’ model or upsell.

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If your organization resides in an industry that is lower on the scale of digital disruption, the last thing you should do is become complacent. Rather, consider preparing for the inevitable by going from analog to digital while your organization is not in a state of emergency—while you have the time and resources to execute a proper digital transformation.

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Going From Analog To Digital

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The tools are out there—automation, cloud services, algorithms—that can help you cut costs, find new business/revenue models, and better serve your customers. But the tools don’t just bolt on to your existing organization and solve all your problems; you need a rebuild from the ground up. Consider these tactics toward DX at a high level.

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1. Think in systems

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Don’t just offer a better widget or a new-and-improved product—change the game! Consumer-facing digital platforms are good examples of a completely new way of thinking that benefits the consumer and the company.

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2. Hire the best

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If you have an old guard at your organization, there’s a high likelihood that none of them is suitable to lead a digital initiative, regardless of work ethic, loyalty, or skills. You really need a fresh set of eyes on a DX project that has none of the bias from years of internal processes and old practices.

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Note: There’s a case to be made for educating your existing staff as well. They may have conformed in order to have their voices heard, not because they don’t have creative ideas of their own.

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3. Shift budget to new initiatives

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It’s a cold fact of business, but without funding to support your DX projects, they’ll never get off the ground. If you’re not able to put additional budget toward the transformation, his may mean that you have to cut funding from older initiatives. In fact, if everything goes as planned, you’ll eventually de-fund legacy programs anyway, but just be careful you don’t end up taxiing for takeoff without a fully built airplane.

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4. Reorganize your team structure

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Layers of bureaucracy stand in the way of the innovative processes you seek with DX. Consider flattening your hierarchy and allow your employees to be team-based and somewhat fluid. Collaboration and lean startup principles are a good place to start.

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Are you part of an organization that’s still actively supporting a lot of analog practices? We’d love to hear about your challenges and approach to DX in the comments below!

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Or, if you’re looking to level up your game, consider enrolling in our free Digital Strength program. Enrollees will learn effective methods for organizing and executing successful transformation programs, and gain the knowledge needed to become a leading changemaker within any company.